EU Proposal for taxing Apple & Co: Need to slaughter the sacred cow of unanimity in the Council of Member States

joint proposal to combat tax avoidance of Apple, Google, Amazon andother large digital companies. Because companies in the digital worldcan easily shift their profits to low-tax countries, in the future,internet companies are expected to pay taxes on their turnover. Thiswould be a paradigm shift from the taxation of profits to the taxationof turnover. As of Friday, EU finance ministers meet in Tallinn todiscuss the proposal.

"The initiative to tax Apple & Co. is overdue. Instead of parking theirbillions in profits in tax havens, internet giants must also make theircontribution to the financing of the community in Europe. The unfaircompetition between internet giants and the local economy underminesthe European internal market.

The new idea of the finance ministers, however, distracts from the realproblem. Also the new proposal needs unanimity in the Council of MemberStates, which is hardly to be expected. Therefore, Finance MinisterSchäuble and his colleagues have to give up their opposition toEuropean majority decisions in tax matters. Otherwise the new proposalremains an election-campaign gag.

The ministers of finance which are willing to act should invite theCommission to submit a legislative proposal under the majorityprocedure as foreseen in Article 116 of the EU Treaty. Tax dumping canalready now be stopped by majority voting. Currently, several proposalsfor combating tax avoidance in the EU are on hold because they areblocked by tax havens in the EU.

We must put an end to the patchwork of tax legislation in the EU: thecommon consolidated corporate tax base and a minimum rate for corporatetaxation in the EU must also be placed on the track of majoritydecisions."

The proposal for the taxation of the digital economy is presented in amemo by the four EU finance ministers: